The present invention is generally directed to electronic check processing. More particularly, the present invention is directed to image based processing of electronically presented items, such as bank checks.
Electronic check presentment (“ECP”) is the electronic transmission of the contents of an interbank transmittal form known as a cash letter, or an electronic cash letter (“ECL”), as captured from the magnetic ink character recognition (MICR) line on each check, to the drawee bank ahead of the physical arrival of the checks actually in the cash letter. The electronic cash letter consists of a listing of items, i.e., checks drawn on a particular bank, referred to as the “payor bank.” For each item, the ECL includes an item sequence number, a routing/transit (“RT”) number, an account number and amount. Conventionally, a paper cash letter, including the physical paper items, is sent after the ECL is transmitted, and the paper items are recaptured by the payor bank and reconciled against the ECL. Often, check images are also digitized by the bank of first deposit, particularly, large banks that process a large number of checks, in connection with the reading and sorting of the checks. However, conventionally, even if the checks are digitized, the paper checks are still sent to the payor bank for reconciliation against the ECL.
Currently, the banking industry is moving toward check truncation, which is elimination of the physical paper items in the check processing system, preferably, by the bank of first deposit. Because the physical paper is “truncated” by the bank of first deposit, it is necessary to convert the paper items into an electronic debit and to create and store a digitized image of the check. Thus, in lieu of sending the paper cash letter, which includes the paper checks listed in the ECL, check image data is transferred to the payor bank either after the transmission of the ECL or with the ECL itself. The check image data can be transmitted via existing computer networks or stored on magnetic media, such as tape, and the magnetic media is physically transferred.
Check truncation, and the transmission of check image data, however, creates problems. One problem is preserving “linkage integrity.” Linkage integrity is linking, i.e., electronically associating, the correct check image data with its ECP data, which was transmitted via the ECL and that is posted to the payor bank's Demand Deposit Account (“DDA”) system. If linkage integrity is not preserved, it becomes difficult, if not impossible, to retrieve the check image data corresponding with ECP data. A bank may need to retrieve check images in connection with providing account statements to bank customers or for internal research purposes.
Another problem associated with check processing and electronic check presentment and check truncation, in particular, is in the area of reject repair. Generally, a reject is an item (in an ECL) for which magnetic ink character recognition (MICR) codeline data is missing or incomplete. Conventionally, rejects could not be repaired until the physical paper items were received via the paper cash letter. Since the paper cash letter often was not received by the payor bank until the day following the transmission of the ECL, the payor bank would go through a processing cycle and rejects would not be posted until the next day.
Another problem that is associated with using image data in connection with ECL processing is that many financial institutions have significant capital and personnel training investments in existing check processing hardware and software. In particular, many financial institutions have implemented check processing using the Check Processing Control System (“CPCS”) product available from IBM Corporation, and would prefer to leverage their investment in CPCS as they transition into the check truncation environment and image based ECL processing.
Yet another problem associated with image based ECL processing is handling image errors. The present invention provides for the flagging of image errors. These error conditions can be related to the size of an image segment or to a missing image segment. An import process can also flag image conversion errors when there is a need to convert the source image format to an alternate format. Responsive actions to the errors are based on user-defined parameters.